You’re starting to see it happen every day. You visit the grocery store and realize that bacon costs $1 higher than it did last week. You pull up to the gas pumps and see that it’s $.30 a gallon more than it was the other day. This has happened at least 10 times this year and the price of gas is really expensive right now.
Something has to give.
I can’t tell you that inflation is going to disappear in the near future. Why? I do not own a crystal ball.
But I can tell you this. Investing in gold is one of the best ways to hedge your bets against inflation. It’s a major reason why so many people are willing to buy a gold IRA.
And we’re just getting started. Improving your chances of minimizing inflationary damage is only one big advantage of gold IRA ownership. I’d like to tell you about some of the other major reasons to consider this investment opportunity.
A Quick Rundown of the Advantages of a Precious Metals IRA
- True portfolio diversification
- Gold’s track record during tough economic times
- Paper asset protection
- Total control over your investments
- Huge tax benefits
Need I say more? Actually, that’s exactly what I’m going to do because I’d like to break down these benefits even further.
Before I begin, consider opening a gold IRA sooner rather than later. Learn about the top 10 best gold companies in the industry by reading my detailed review.
Reason #1: Experience True Portfolio Diversification
Most investors believe they’ve achieved portfolio diversification by buying stocks in different sectors. They think this represents enough diversity to protect their portfolio. Unfortunately, these future retirees learn about the realities of diversification the hard way all too often.
Let’s take a look at the stock market crash in 2008 as a prime example. During that time, the entire stock market got crushed to put it bluntly. The Dow Jones went from around 14,000 and traded less than 7,000 in a matter of months.
Guess what else happened?
Future retirees lost their shirts. Suddenly, a $300,000 retirement portfolio was only worth $150,000! Many people tried to find work in one of the worst economic environments that we’ve experienced since the Great Depression.
And as you can imagine, older people without college degrees didn’t fare too well. They were vying for jobs against young professionals with MBAs, master’s degrees, and PhD’s that were fresh out of college.
Even worse was the fact that nobody was hiring.
There was a silver lining to this dark cloud for certain intelligent investors that mastered the art of true portfolio diversification.
During this same time frame, the value of gold went through the roof! It was the only safe haven investment in existence at the time. Things have changed and cryptocurrencies are also a safe haven now. But back then gold was the only place to park your money.
And it was absolutely worth it.
The value of gold skyrocketed from around $700 an ounce up to nearly $2000 an ounce. It stayed there until it eventually pulled back to around $1500 an ounce.
Gold investors didn’t have to come out of retirement. They were protected by this immensely successful investment.
Are you ready to begin investing in a gold IRA? Learn about the top gold IRA companies by reading my full review of my top 10 picks.
Reason #2: Gold Has an Amazing Track Record During Tough Times
I already alluded to this earlier but it definitely deserves a bigger explanation. So, I’m going to share another more recent example with you.
In February 2020, the world was suddenly a very different place. And investors on the stock market knew that the economy was entering into a forced recession.
What happened at this time?
From early February 2020 to mid-March 2020, the financial markets took a complete nosedive. In many instances the markets dropped anywhere from 35%-50%, and certain individual stocks lost so much more money.
Here’s a scary thought:
On February 25, 2020, the S&P 500 began a two-day selloff that resulted in a loss of $1.737 trillion.
This was only part of the total money lost during this crazy and unexpected time that nobody was prepared for. And it wasn’t as bad as the Great Depression, but it was financially devastating for many retirees.
Do you know what else happened during this time? From a February 4, 2020 to March 7, 2020, the value of gold increased by $160 an ounce.
As usual, gold became a safe haven opportunity for rightfully scared investors. They began storing their wealth in this valuable commodity because it has 5000 years’ worth of longevity backing it up.
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Reason #3: Precious Metals Deliver Lasting Paper Asset Protection
Many people decide to buy gold IRA because they need to take advantage of the paper asset protection. This protection is needed because when inflation rears its ugly head, some popular paper assets become vulnerable.
As an example, many of the vulnerable types of investments include the following: real estate, ETFs, stocks, bonds, mutual funds, index funds, and others.
Every investment mentioned above is considered a paper asset. As we know, when the economy suffers a downturn, inflation tends to be a big part of the problem. These investments typically decrease in value during uncertain economic times.
What about the value of gold and other precious metals?
You’ve learned time and again that the value of gold and other precious metals increases during economic hardships. It was proven in 2008 and 2009 during the housing and financial market crash. It was proven again in 2020 when the market crashed because of the virus that shall not be named.
I don’t know about you, but I always take steps to protect my paper assets from unwanted or unexpected downturns. And the best way to accomplish this task is by investing in gold, silver, platinum, and palladium.
In my opinion, this investment is only worth wild if you buy a gold IRA. Learn about the top 10 gold IRA companies by reading my roundup review.
Reason #4: Have Complete Control over Your Investments
Are you tired of your account manager making foolish or unnecessary investments on your behalf? Are you frustrated when you look at your account statements and realize that you have zero control of your investments?
For some reason, foolish people believe that their account manager or mutual fund representative has their best interest at heart. They may not be out to get you per se, but they really don’t care if you fail or succeed.
Guess what? The only one to truly care about your success is you and maybe your closest family members. But that’s about it. So, it’s time to take complete control over your investments. It’s time to take your power back, so you can invest on your own terms.
I don’t know about you, but I see the writing on the wall and it doesn’t look good. Inflation is going through the roof. Gas prices are more expensive now than they’ve been since the crash in 2008. And the housing market is skyrocketing beyond our control.
In some cases, this is a good thing. But for the most part, this is a sign that the economy has gotten off kilter. It’s also a sign that you need to begin investing in gold and other precious metals. And the best way to accomplish this is to buy a gold IRA. You’ll finally take complete control of your investment portfolio once and for all.
Reason #5: Experience Massive Tax Benefits like Never Before
Did you know that self-directed IRA account holders get exciting tax benefits? The IRS makes it possible to build your wealth for retirement in tax-free or tax-deferred accounts. You’ll have to decide which account makes the most sense to meet your personal needs.
As an example, if you were to open a traditional self-directed IRA account, you’d have the opportunity to get tax deferred benefits. This means you’ll lower your annual gross income by the amount deposited into your IRA account. And you aren’t responsible to pay taxes on this income until you begin taking distributions during retirement.
If you’re wondering, the earliest age to begin taking distributions is 59 ½ years old. If you take a distribution earlier, you’re subject to a 10% early withdrawal penalty. You’ll also have to pay your taxes the next time you file.
Opening a Roth self-directed IRA leads to tax-free investing. You fund a Roth IRA with money that was already taxed by the IRS. So, all the proceeds in this account are yours to keep.
I hope you truly see the value of these amazing benefits. By now, you should be thoroughly convinced that it’s in your best interest to buy a gold IRA. Otherwise, your portfolio will end up suffering at some point because of a lack of diversity and protection.
To get started on your precious metals IRA journey, please learn about the top companies in the gold investing space. Read my top 10 review of the best gold IRA companies in business right now before you get started.